2/21/2007

The marketplace works like this: Sites such as MyFICO and ArcaMax place on a Web page an interactive form for visitors to fill out. MyFICO -- which computes consumers' credit scores and sells this data to credit bureaus -- asks visitors who are interested in taking out a home mortgage, for example, to specify the size of the mortgage they need.

The site then looks up the applicant's credit score and sends the information upstream to LeadPoint. The two or three mortgage makers who've currently given LeadPoint the highest bids receive the information electronically. Because a mortgage origination can make thousands of dollars of profit on each mortgage, the going rate is about $50 for the referral of a live prospect. The winning bidders follow up by sending competitive mortgage proposals to the original visitor.

Overall, LeadPoint's Rosenberg states, his company's network has signed up more than 1,000 providers of products and services and 400 Webmasters who send prospects to these firms. Based on the last six months of leads sent to mortgage originators via his company's marketplace, he says, the owners of the MyFICO site are projected to receive $2 million a year in commissions.

Perhaps we should call it Affiliate Marketing 2.0 million.

In this space next week, I'll give you a deeper look at the new ways that buyers of leads, and the Webmasters who provide them, are interacting.